Bank of England: The Metaverse Poses Increased Systemic Risks
Owen Lock and Teresa Cascino, experts at the Bank of England, have said the widespread adoption of crypto assets in the metaverse could pose a systemic risk to financial stability and would require «strong consumer protection.»
According to them, large volumes of «real economic transactions» in cryptocurrencies will pass through decentralized digital worlds and platforms, which could have potential consequences for financial stability.
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They have said:
«An important step is therefore for regulators to address risks from crypto assets’ use in the metaverse before they reach systemic status.»
Experts have presented a scenario in which consumers spend a lot of money and time in virtual worlds. Households will be able to store part of their savings in digital assets. Businesses, in turn, will start accepting payments in cryptocurrencies, and financial institutions will start offering industry-related services.